Treasury and IRS
Issue Depreciation Regulations

Courtesy of IRS


Today the Treasury Department and Internal Revenue Service issued guidance relating to the election to deduct the cost of certain tangible property and computer software. The regulations reflect changes to the law made by the Jobs and Growth Tax Relief Reconciliation Act of 2003.

The proposed and temporary regulations issued today generally permit small business taxpayers to elect to deduct up to $100,000 of the cost of qualifying property purchased and placed in service in a taxable year beginning after 2002 and before 2006.

Additionally, taxpayers are permitted to make or revoke an election on an amended return for those taxable years without the consent of the Commissioner.

The temporary regulations are effective for taxable years beginning after 2002 and before 2006.

For more details

[TaxMama - what does this mean to you? It means that if you filed your tax return for 2003 without taking advantage of the higher expense limits, you may amend those returns now.

Note: in the past, you could not file an amended to do this without the filing a petition to request permission from IRS.

In addition, IRS has added software to the list of items you can write off using Section 179. Naturally, this only applies to things like consumer software products - not expensive, custom software.]


Courtesy IRS
Published TaxMama.com 8.27.04